A comprehensive guide to using Classes, Properties, Locations, and Projects in QuickBooks Online Pro or Advanced, complete with real business examples and expert advice on utilizing an outsourced bookkeeper.
As a business owner or manager, you probably know the importance of keeping accurate financial records. QuickBooks Online Plus and QuickBooks Online Advanced are cloud-based accounting software options that can help you manage your finances more efficiently. It offers a variety of tools and features that can help you streamline your accounting processes and save time. In this blog post, we’ll take a closer look at four of the most important tools in QuickBooks Online Plus & Advanced: Classes, Locations, Properties, and Projects. We’ll explore what they are, how they work, and how they can benefit your business. We’ll also discuss how your Outsourced Bookkeeper can help.
A. Classes
Classes are a way of categorizing transactions in QuickBooks Online Plus & Advanced. You can think of them as tags or labels that you can assign to transactions to help you keep track of different types of income and expenses. For example, if you run a construction company, you might create classes for different types of jobs, such as “remodeling,” “new construction,” or “repair work.” You could then assign these classes to each transaction to help you see how much money you’re making on each type of job.
Classes can be used for more than just tracking income and expenses. You can also use them to track other important metrics, such as time, mileage, and labor costs. For example, if you have employees who work on different types of jobs, you could create classes for each employee and assign those classes to their time entries. This would allow you to see how much time each employee is spending on each type of job. This in turn helps you to make more informed decisions about scheduling and resource allocation. With this in mind, let’s move on to Locations.
B. Locations
Locations are similar to classes in that they allow you to categorize transactions in QuickBooks Online Plus & Advanced. However, while classes are typically used to track different types of income and expenses, locations are used to track different physical locations or branches of your business. For example, if you have multiple retail stores, you might create locations for each store and assign transactions to each location based on where they took place.
Like classes, locations can be used for more than just tracking transactions. You can also use them to track inventory levels, employee time, and other metrics. For example, if you have multiple warehouses where you store inventory, you could create locations for each warehouse and track inventory levels for each location. This would allow you to see how much inventory you have on hand at each location, which could help you make better decisions about how to allocate inventory between warehouses. Need more flexibility? Let’s look at properties.
C. Properties
Properties are another way to categorize transactions. They are similar to classes and locations in that they allow you to tag transactions with additional information. However, properties are more flexible than classes or locations, as you can create custom properties that are specific to your business. For example, if you run a property management company, you might create custom properties for each property you manage, such as “square footage,” “number of bedrooms,” or “rental rate.” The above three look at long-term tracking. But what about short-term tasks or Jobs?
D. Projects
Projects are a way to group transactions together.. They are similar to classes, locations, and properties in that they allow you to categorize transactions based on specific criteria. However, projects are more focused on specific tasks or jobs that your business is working on. For example, if you run a marketing agency, you might create a project for each client you work with, and assign all transactions related to that client to that project.
Projects can be used to track a wide variety of metrics, depending on your business needs. For example, if you run a general contracting business, you might create projects for each construction job you’re working on. This would allow you to track expenses, time, and other important metrics related to each job. You could also use projects to track progress and milestones for each job, which could help you stay on schedule and avoid delays.
Comparing Classes, Locations, Properties and Projects
| Classes | Locations | Properties | Projects | |
|---|---|---|---|---|
| Categorization | Transactions | Transactions | Transactions | Transactions |
| Focus | Type of income | Physical location | Custom metrics | Specific tasks |
| Examples | Remodeling, new construction | Retail stores, warehouses | Square footage, number of beds | Client names, job names |
| Benefits | Track income and expenses for each type of job | Track expenses and inventory at each location | Track custom metrics specific to your business | Track progress and milestones for each task or project |
One of the great things about QuickBooks Online is that you can use these tools in combination to get a more complete picture of your business finances. For example, if you run a property management company, you might create classes for different types of properties (e.g. apartments, single-family homes, commercial properties), locations for each property you manage, and properties for important metrics like square footage and rental rates. You could then use projects to track income and expenses for each property, which would allow you to see how much money you’re making on each property and make more informed decisions about how to allocate resources.
So how can these tools benefit your business? Here are a few real-world examples:
A. General Contractors
If you run a general contracting business, you could use:
- classes to track different types of jobs (e.g. remodeling, new construction, repair work),
- locations to track different job sites,
- properties to track important metrics like square footage and building materials, and
- projects to track progress and milestones for each job.
This would allow you to see how much money you’re making on each type of job, which job sites are most profitable, and how each job is progressing.
Law Firms
If you run a law firm, you could use:
- classes to track different types of cases (e.g. criminal, civil, family law),
- properties to track important metrics like billable hours and court jurisdiction, and
- projects to track progress and milestones for each case.
This would allow you to see how much time you’re spending on each case, how much revenue each case is generating, and whether you’re meeting your deadlines.
C. Marketing Agencies
If you run a marketing agency, you could use
classes to track different types of clients (e.g. B2B, B2C, non-profit),
- locations to track each client’s physical location,
- properties to track important metrics like marketing budget and ROI, and
- projects to track progress and milestones for each client.
This would allow you to see which clients are most profitable, which marketing tactics are working best, and how each client’s marketing campaign is progressing.
3. The Role of Your Outsourced Bookkeeper
An outsourced bookkeeper can be an invaluable partner in maximizing the benefits of Classes, Locations, and Projects. They can provide expert advice on setting up and customizing these features, ensuring consistency and relevancy in your financial tracking. Additionally, an outsourced bookkeeper can offer training and ongoing support to help you make the most of these features, streamlining your financial management processes and enhancing overall efficiency.
4. Best Practices for Using Classes, Locations, and Projects
To optimize your use of Classes, Locations, Properties, and Projects, consider the following best practices:
- Plan your structure: Before creating any classes, locations, properties, or projects, take some time to plan out your structure. Determine what categories you need to track and how they should be organized. This will help you avoid confusion and ensure that your data is consistent and accurate.
- Use consistent naming conventions: Use consistent naming conventions for your classes, locations, properties, and projects. This will make it easier to search and filter your data, and will help ensure that everyone on your team is using the same terminology.
- Assign codes or numbers: Consider assigning codes or numbers to your classes, locations, properties, and projects to make them easier to manage and identify. This can also help you quickly find and organize your data.
- Customize as needed: Customize your classes, locations, properties, and projects to fit your specific business needs. Add custom fields or properties to track unique metrics that are important to your business.
- Train your team: Ensure that everyone on your team is trained on how to use classes, locations, properties, and projects in QuickBooks Online Advanced. This will help ensure that everyone is using these tools consistently and accurately.
- Regularly review and clean up data: Regularly review and clean up your data to ensure that everything is accurate and up-to-date. This will help prevent errors and ensure that your reports are accurate.
- Use reports and dashboards: Use reports and dashboards to gain insights into your business finances. These tools can help you quickly see trends and identify areas where you need to make changes.
- Work with an outsourced bookkeeper: Consider working with an outsourced bookkeeper to help you set up and use classes, locations, properties, and projects in QuickBooks Online Advanced. A bookkeeper can also help you review and analyze your financial data to make more informed business decisions.
Conclusion
QuickBooks Online Plus & Advanced offers powerful features like Classes, Locations, Properties and Projects that can be invaluable for businesses across various industries. By understanding how to use these features effectively and implementing best practices, you can optimize your financial processes, make informed decisions, and improve your overall financial performance.
Furthermore, partnering with an outsourced bookkeeper can provide valuable support, expertise, and insights, helping you maximize the benefits of these functionalities and streamline your financial management.
